Most business people would say that improving their business performance is a key goal for the next financial year. This is a very broad goal so where do you start?
Below we have outlined our top 10 tips that if you follow will assist you in achieving your goal of improved business performance.
1. Define Your Goals: before you can measure and improve your business performance you need to know where you want to go, then you can plan how your will get there. Make sure you are specific and that the goals are achievable and measurable.
2. Determine the metrics you will use to measure your business improvements
There are many different metrics you can apply to measure the business improvements you achieve. Make sure you are measuring the right things, and that improvements in these areas really will lead to overall improvements in your business performance.
Below are some examples of different metrics you can use to measure and track your business improvements.
Marketing: sales growth; market share; distribution methods; sales force size, effectiveness and training; advertising budget and effectiveness; inventory levels, delivery time; product quality; customer retention rates
Production: plant capacity, locations and age; age of equipment; ability to expand capacity; skill and turnover of labor force; union relations; quality control; supplier retention; raw material sources
Administrative: employee turnover, age of facilities
Management: experience, depth and turnover of top, middle and supervisory managers; effectiveness of communication systems; access to information; cohesiveness of top management ranks; compensation plans; decision-making speed; strategic planning ability
Technology/Research & Development: age of R&D facilities; age of production technology; production patterns; basic innovation; engineering abilities; experience of R&D team; R&D budget; R&D project timelines
3. Make sure that you regularly collect data about your chosen metrics: Determine a process for tracking and reporting all relevant data. Report on trends that emerge from your findings on a regular basis.
4. Compare Yourself to the Competition: Also known as benchmarking, this is a great way to get an idea of how your business is doing in comparison to your competitors. This can provide some insight into what you can do differently to improve you business performance. For help on comparing your business to your competitors, you can download our free guide on competitor analysis
5. Conduct Research: When you need specific information about your customers and prospects that doesn’t exist, conduct your own research. This does not need to be difficult or elaborate but will really help you understand your customers and their needs better. For help in conducting your own research with have a guide you can download Market Research made easy.
6. Understand Your Strengths and Weaknesses: Rate your company on your developed list of metrics in comparison to your competitors. Look for clusters of strength that may give you a competitive advantage.
7. Focus on Customer Retention: Customer retention is a matter of business survival, if you are losing customers as quickly as you are winning new ones your business will never grow. Plus getting a new customer is five times more expensive than retaining a current one. So make sure you are looking after your existing customers, that they know all the products and services you offer and you go out of your way everyday to wow them.
8. Measure Marketing Effectiveness: Marketing is about growing your business and making sales, so never undertake any marketing activity without a clear goal in mind. What do you want to achieve from your marketing activity and how will you measure it so you know how it has performed. Effective measurement lays the groundwork for future plans and improving your activity. If you are looking for idea to improve your marketing activity check out our guide on Marketing Activity that works.
9. Track Employees: Having top employees who are motivated is critical to your company’s success. Setting clear goals and performance targets for employees is key to ensuring they know what they need to achieve and also significantly improves their performance and subsequently that of the company. Once you have measures in place you can then track staff performance against these measures and monitor effectiveness of your employees. .
10. Apply the Information: Don’t just collect data for data’s sake. Take the time to analyse the information you’ve collected, draw conclusions and make recommendations based on it. Then most importantly put together a plan of action as to how you are going to implement changes as a result of your findings to deliver improvements for your business.
KPI’s are a great way to monitor and improve your business performance, so if performance improvement if a goal of yours why not book in to attend our free webinar on Monday 25th May, 11:30 – 12:30 – Setting KPI’s to improve your business performance” – you can register here.
This webinar will look at the importance of KPI’s, how to use them and also help you identify KPI’s that may be suitable for your business.